The thing is I save most of my money anyways. I probably save 60-70% of my paycheck every payroll. The company does not match, hence I am thinking it would be better in my own hands? I would have larger capital to play with NOW and have more freedom in terms of how I want to play the market. I'm wondering how much tax advantage is that much of an issue vs present value opportunity?
Are you sure about that? I kept several 401k from my previous employers and only recently rolled them all into an IRA. I paid no additional fees beyond the management fee for the fund. Last I checked, the S&P 500 vehicle in my 401k had equal fees to SPYs. Tax advantage is very important in many ways (e.g. if you rebalance between assets, you don't want the tax scrape).
Tax advantage space is big deal, as long you have few low cost funds in your 401k. Just plug-in in numerous calculators out there to see the effect of tax free growth vs same amount in taxable space. If your 401k fund has only expensive funds, then only it doesn't make any sense to invest there. For some asset classes like bonds, real estate funds, emerging market funds which throws off lot of dividends and income, this tax advantage space is ideal. Otherwise you will be paying lot of taxes on these income and dividends at oridinary income rate every year
Also, considering the future of America....I guess you have to speculate on whether America will have higher tax rates or lower tax rates than today?
That's why good asset allocation based on risk tolerance is important. Even during depth of 2009 crisis 50:50 stocks and bonds had less than 25% draw-down. If one is still uncomfortable 25:75 had less than 10% max draw down. You are advocating shorting, which has unlimited loss potential.
Which would be one of the deciding factors of whether you would go with a Traditional 401k or a Roth 401k?
Future tax policy prediction is crap shoot. You have to make decision based on the information on hand. Generally assumption is that your retirement withdrawal income will be less than your average working period earnings. Even with slightly higher tax rates, you would be still ahead because of tax free compounding growth.
instead of worrying about market tops/bottoms.... at this age priority number one is get your earning power up... way up! making 50k? figure out how to make 100k. 100k? figure out how to make 200k and so on. that is by far the game changer, instead of wasting effort to time the market.